Do I Need a Premises to Work in the Motor Trade?

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If you’re thinking of starting a business in the motor trade then you’ve likely considered whether you need a premises or not. The simple answer to this question is – it depends. There are certain industries in the motor trade where you absolutely need a premises. For example, MOT centres, tyre fitters, valeting agents and vehicle bodybuilders are just a few of the business types where a premises would be required.

However there are also types of jobs within the motor trade where a premises is not a necessity; at least not at first.

Motor trade professions that don’t require a premises –

• Mobile mechanics
• Part-time traders
• Car sales
• Breakdown recovery
• Start up traders

Although none of these professions require you to have a premises, in some cases it would be beneficial. For example, if you’re buying and selling cars then having a premises means more space, which means you can hold more stock and do more business.

Often those who are just starting a motor trade business will work remotely or from home and then invest in a premises as their business grows. In most cases having a premises would be preferable after a certain point since it enables you to expand and take on employees.

Do I need a premises to get motor trade insurance?

No, having a premises is not a requirement to get motor trade insurance. There are some requirements you must meet to qualify however. These include –

• You must hold a full UK driving licence
• You must be able to prove you work in the motor trade (usually by providing receipts)
• You must be at least 21 years old

Is insurance cheaper without a premises?

Insurance is one of the main expenses when you work in the motor trade so it’s natural to think of ways to reduce the cost. Not having a premises certainly lowers your expenditure overall and often makes motor trade insurance considerably cheaper too. This makes sense when you think about it. When you have a premises, it needs to be insured for risks such as theft, vandalism and  break-ins.

Those who do have a premises often get what is known as a ‘combined policy’. With a combined policy, vehicles and the premises as well as stock, tools and cash are covered. If you don’t have a premises then you’re able to get a policy that simply covers you for working on and transporting customer vehicles.